Free course · Lesson 7 · 4 min
ATM offerings: selling new shares straight into the market
In 4 minutes: what an ATM is, what limits it, and how to spot it on Panda Desk.
Next to the text is Panda Desk, the real app. As you read, the part we talk about lights up.
Checking your access…
01What an ATM is
The company sells new shares straight into the market. A little at a time, at whatever the price is.
02No shelf, no ATM
An ATM can only run off an effective S-3 shelf.
03The 424B5 switches it on
The terms arrive in a prospectus supplement, usually a 424B5. From that day, the agent can sell.
04The real limit: the baby shelf
Public float under $75M? The company can sell at most 1/3 of it in 12 months. ATM sales count.
The number that matters is $2.2M: about 0.64M shares, 20% of the float.
05Volume decides the damage
Nothing on the tape marks ATM shares. Big volume absorbs them. On a quiet day, the same selling pushes the price down.
06Does it need the cash?
Low cash plus a spike is when the ATM gets used. A company with years of cash can let a run go.
07You only see the sales later
The agent does not announce each sale. The next 10-Q shows how much the ATM sold.
08Panda Desk sums it up
093 checks for any ATM
Sources
- 17 CFR 230.415(a)(4): the definition of an at-the-market offering and the Form S-3 / F-3 requirement.
- 17 CFR 230.424(b): prospectus supplements.
- Form S-3, General Instruction I.B.6 and its Instructions 1 to 3 and 7: the one-third cap, the 60-day price window, the $75M threshold and the calculation on the prospectus cover.
Panda Desk shows these rows for any small cap, next to your montage. tspanda.com
Not financial advice. PNDA is fictional, and nothing here is a recommendation to buy or sell.